Deducting a Casualty Loss
How to deduct a casualty loss?
To deduct a casualty loss, you must be able
to prove that you suffered a casualty.
Your records must show all of the
The type of casualty (fire, car accident, etc)
The date the casualty occurred
That the loss was a direct result of the casualty
That you owned the property, or, if you leased the
property, that you were contractually liable to the
owner of the loss.
Whether a claim for reimbursement exists and there
is a reasonable expectation of payment.
Records of the casualty loss
Your records should include photographs of
the damaged property. If is helpful to have photos of the
property before it was damaged. Newspaper articles reporting
the fire, hurricane, etc. help to prove that the casualty
occurred and that your loss was a direct result of the
You will also need your deed, sales receipt,
or other proof of ownership or title.
Which tax form to use to report casualty
Both casualty loss and theft loss are
reported on Schedule A, line 19 if the loss relates to damages
to personal use property. The tax form 4684, Casualties and
Thefts, is used to calculate the tax deduction resulting from
casualty loss or theft loss.